Uni debt (HECS)

[andy456]

Ok. After receiving my Monash course fees I have realised I can pay them off (Semester 1 at least). Or I could spend my money on a holiday at the end of the year or in the future. So I would like to know peoples opinions on what they would do if they had the opportunity to go through first year uni without getting any debt.

[Duck]

Go ask your parents (or any financially independent person) whether they would accept an interest free loan.

[Gloamglozer]

Go on the holiday.

Pay it off later when you earn more than ~45 k per annum.

It'll be worth it. 

[jimmy999]

I chose to keep my scholarship money instead of paying my HECS off for a few reasons, I needed the money to help with transport to and from uni (most of my first scholarship payment goes towards car insurance and registration), and without having time to work, I need some money for food. Another reason is that I now have a lot more money than I did a year ago and soon enough will be able to spend it on luxury things such as a new laptop and potentially a holiday.

Don't pay your HECS debt off now. Keep the money and spend it on yourself. You want to enjoy uni as much as possible, and this includes going on random holidays and doing crazy things. Worrying about money and loans is something to worry about once we have jobs

[binders]

don't forget though, if you do pay upfront, you get a 20% discount on your fees. so while there are good reasons to keep cash in hand now, you will probably have to pay it eventually, and you have the chance to save yourself 20%. worth thinking about.  If i had the opportunity to finish 1st year without debt, i would take it.

[Russ]

The 20% off only matters if you can afford it, you shouldn't be stretching to make the payment just to get that benefit.

I'm fairly sure any voluntary contribution after you graduate attracts a lesser discount anyway

[jimmy999]

The 20% off only matters if you can afford it, you shouldn't be stretching to make the payment just to get that benefit.

I'm fairly sure any voluntary contribution after you graduate attracts a lesser discount anyway

I'm pretty sure that last year, if you paid $500 upfront, then the fees for that semester would be 20% less, thus when you pay it off later it will be cheaper. (I might have this mixed up, I didn't really pay attention to fee stuff)

[Gloamglozer]

The 20% off only matters if you can afford it, you shouldn't be stretching to make the payment just to get that benefit.

I'm fairly sure any voluntary contribution after you graduate attracts a lesser discount anyway

Not any voluntary contribution but almost.  It's the same.  Over $500 voluntarily attracts 20% discount.

[andy456]

When we earn above the threshold does the payment come out of your weekly, monthly whatever pay like tax.... or is it like at the end of the financial year a bill is sent to you based on your earnings for an upfront payment??

I can't make up my mind.... my mum really wants me to pay off debt which is boring...

[jimmy999]

When we earn above the threshold does the payment come out of your weekly, monthly whatever pay like tax.... or is it like at the end of the financial year a bill is sent to you based on your earnings for an upfront payment??

I can't make up my mind.... my mum really wants me to pay off debt which is boring...

It automatically gets deducted out of your pay like tax. My sister who just earnt above the threshold had about $8 a week come out of her pay. Obviously it increases for the amount you earn.

[Leena]

i would pay upfront
holidays can come later, i would rather be wait to take a holiday when i dont have to worry about being in debt later

[ninwa]

After uni, you'll need to find a job, move out, pay rent/mortgage, pay bills and car regos and petrol and possibly raise a family if you're so inclined etc. etc. etc.

i.e. you have the rest of your life to be boring, now's the best time to travel and have fun. Remember, the debt is interest free... I wouldn't pay now if I were you.

[Russ]

I can't make up my mind.... my mum really wants me to pay off debt which is boring...

Ignore her, she can't tell you what to do about your education any more. If you want to pay and you have no plans for the money, well, there are worse things you can do but don't pay your fees just to have no debt. You're not paying interest so putting the money in a bank for the next 3 years is probably going to make you money

[Gloamglozer]

It's interest free but it does rise according to inflation, right?

That's what I was lead to believe.

[Russ]

Yes, but Australian inflation seems to average 2.5% which is well below the interest rate on my bank account